It’s no secret that one of the primary factors slowing the growth of cryptocurrency is the fact that it has not yet caught on as a viable method of payment for everyday transactions. Until cryptocurrency is adopted by a sufficient number of both consumers and merchants as a payment mechanism, all the revolutionary blockchain technology in the world will not gain a seat at the table with fiat currency. It may be unpopular to say, but while blockchain technology looks like it’s here to stay, the future of cryptocurrency itself remains very much in doubt.
In simplest terms, the slow growth in cryptocurrency payments is usually attributed to one or more of the following: (1) high volatility in crypto prices; (2) long confirmation times and high fees; (3) uncertainty over legal and regulatory status; and (4) the paucity of merchants who accept crypto payments.
Koinon.io is an Asia-based payment infrastructure company that is working to tackle the last item on the list, making it seamless for both online and offline merchants to accept all types of payments without having to change the way they process transactions. Once this barrier has been removed, it’s a solid bet that progress on the other three items will follow much faster than it has thus far. Once customers have plenty of places to spend their crypto, there will be an even greater impetus for the key players to work out the other issues.
FOCUS ON ENABLING MERCHANTS
The number of people holding cryptocurrency has grown dramatically since the beginning of 2017. Realistically, these crypto owners won’t have the option of using their holdings for everyday purchases until it becomes standard for crypto to be accepted by supermarkets, restaurants, petrol stations, etc. As it stands, few if any of these types of offline merchants accept crypto. They don’t know how to do it and given that they are already bombarded with deciphering other new payment methods like mobile eWallets (e.g., AliPay, WeChatPay, ApplePay), they have little appetite for adding something else to that list.
It makes good sense if we consider things from the merchant’s point of view. On top of cards, the growth of mobile eWallet payments is forcing them to deal with greater complexity as they decide which mobile eWallets to accept, as well as how to handle the technology addons required, and how to manage yet another vendor relationship. The hassle can be a deal breaker. Adding crypto into the mix, which seems even more daunting because now there is a crypto-to-fiat conversion involved, can easily make it a non-starter.
Koinon’s OmniChannel “take-all” merchant acceptance platform solves this problem, providing a single solution enabling merchants to seamlessly accept crypto, mobile, and card payments – all with a single piece of hardware. With Koinon’s platform, crypto payments are handled at point of sale (POS) in the same way as fiat payments, with a single piece of hardware, a single installation, and user-friendly software maintained via a single relationship with Koinon. Merchants are thus able to accept card, mobile, and crypto payments via a single scanning process, with the result that they receive local fiat currency in their bank accounts.
This simplicity is critical in driving crypto adoption by merchants. Despite the exciting new landscape created by the emergence of cryptocurrency, it’s reasonable to assume that for the foreseeable future most merchants want things to remain the same as they have always been: they price goods and services in local fiat currency, and they receive the appropriate amount of fiat in their bank account at the end of the day. Especially for offline merchants, there hasn’t been a simple way to make this happen until Koinon.
TARGETING DEVELOPING MARKETS WITH LARGE UNDERBANKED POPULATIONS
Koinon sees the greatest opportunity for crypto payments around the Asia Pacific region and in other emerging markets with large swaths of the population still existing outside the traditional banking system. The small existing base of credit and debit card users in such regions provides a more direct path for the growth of mobile and crypto eWallet payments, as there is no need for these consumers to slow the process by first moving from being completely without financial services to adopting traditional bank accounts and credit/debit cards. Instead, they can leapfrog this step entirely, moving straight to mobile and cryptocurrency based financial services and gaining entrance to the global economy.
China provides the model for this growth, owing largely to ubiquitous mobile internet infrastructure and a strong push by powerful mobile payments players like WeChatPay and AliPay. For many Chinese consumers, the mobile phone has replaced the wallet, with most merchants now accepting these two mobile payment methods.
Within a few years, Koinon envisions a similar evolution for crypto payments throughout other parts of Asia and the developing world, with its OmniChannel platform opening the door to allow merchants and consumers to connect however they choose – via card, mobile, or crypto – with no unnecessary barriers to commerce. This is the future that cryptocurrency has been promising since it emerged nearly a decade ago. Koinon makes it possible for this future to become a reality.
Koinon is launching its own KNN cryptocurrency tokens via an ICO planned for Q2 2018. The KNN tokens can be used for merchant transactions, person-to-person transfers such as cross-border remittances from overseas workers, and for fees incurred within the Koinon ecosystem.
For more information, see www.koinon.io